Work Related Self-Education Expenses

In order to substantiate any claims at this item, you must show invoices/receipts as usual.   The course undertaken by the taxpayer must maintain or increase the skills/earning ability within their current field or job role.   For example, a nurse studying to be a doctor cannot claim their self-education expenses whereas a nurse studying to be a higher-grade nurse can.   Please click here for more information.

An ATO review or audit requires evidence of all deductions and proper substantiation documentation (such as log books and diaries).   If the appropriate substantiation and evidence cannot be provided, the unsubstantiated claim will most likely be reduced or denied completely.   

If this happens, there is also a penalty applied by the ATO.   Along with the possibility of a large reduction in your refund from the ATO and associated penalties/fines, there may also be a significant cost associated with preparing your documents for ATO requirements.   Our professional costs can be far in excess of the original tax return cost, even if the ATO don't adjust anything in your return.   We do offer Audit Insurance which covers the professional costs associated with ATO reviews and audits.   However, this insurance does not cover you against any reduction in refund from the ATO and/or penalties and fines applied by the ATO as a result of your audit.

The substantiation required for an ATO audit depends upon the type of claim.   The amount claimable on your tax return is only the portion that you actually paid for (not reimbursed to you by an employer or third party) and only claimed to the extent that the cost was business/work related (private use must be apportioned and removed from the claim).   Tax invoices/receipts must be available to supply to the ATO upon request and generally a line item on a bank or credit card statement is not sufficient evidence.

Please note that as your tax agent, we do not need you to provide us with any invoices or any other form of substantiation such as logbooks or diaries.   However, if you were ever to be audited, you would need to show all forms of substantiation for all claims to the ATO.